Announcing: BitLaundry -- decorrelated payment service

[SmokeTooMuch]

From: https://www.bitcoin.org/smf/index.php?topic=3927.msg56043#msg56043

Hmm, it comes pretty close to BitLaundry

BitLaundry Explanation
BitLaundry is designed to help unlink accounts from each other. It does that by providing a well-known, and hopefully popular service. Here's how it works:

   1. Imagine that Alice wishes to send BitCoins to Bob.
   2. Bob, sadly, is not well liked. Alice would rather not have anyone know that she sent Bob BitCoins.
   3. So, Alice puts Bob's address in the form at BitLaundry.
   4. Alice gets a one-time-use address from BitLaundry.
   5. Alice sends the money to that address.
   6. BitLaundry sends money out to recipients every 30 minutes.
   7. (But, it doesn't send out Alice's money immediately, that might be suspicious..)
   8. So, a random number of 30 minute segments later, BitLaundry sends the money out to Bob.
   9. BitLaundry then deletes the database link between the one-time-use address and Bob.
  10. Alice has sent money to BitLaundry, but people do this all the time. She's one of many.
  11. BitLaundry has sent money to Bob, but BitLaundry has sent money out to a whole bunch of other people as well.
  12. Alice and Bob are much less linked than they would have been otherwise.

But as I understand it, you can track Alice by looking at the block chain and look for the amount that Bob received by BitLaundry.
Then you check which address sent this amount to BitLaundry (probably one of the one-time-use addresses from step 4) and then check which address sended that amount to the one-time-use address.
Is that correct ?

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[BCEmporium]

Alice? Bob? Alice and Bob are out for holidays!

«Don Giovani» wants to pay of his drug stash from «El Diablo»... 

But that still misses the "mule" to be a "complete pack".

[vess]

An update to this thread: BitLaundry and it's code are for sale. Check here: http://bitcointalk.org/index.php?topic=6939.0

[forgotmypassword6x]

This is the wrong way to do things.  The right way is to do it P2P, TOR-style.  Have n people rendezvous via TOR and together construct a transaction that takes as input, $X from each of them, and outputs $X-trans fee to n fresh bitcoin addresses.  To do this naiively, the n people would each tell each other their pairs (old addr, freshaddr), put them together in a transaction (randomize the order of outputs relative to order of inputs), and then all sign.  However, this is bad because you have told the other people that your new addr is linked to your old one.  The correct way is to use secure multiparty computation to generate the transaction in such a way that, in the end, all parties only learn the entire transaction (NOT which new addr corresponds to which old one).
Furthermore, if any subset of k the n people collude to break the others' anonymity, the best they can do is know that
the n-k output addresses not owned by them came from the n-k input addresses not known by them, but nothing more.

[vess]

Final update: I sold BitLaundry to Mike Gogulski. He's in charge now.